US Treasury Secretary Janet Yellen has indicated that the US government will not bail out the defunct Silicon Valley Bank (SVB).
According to news channels, a bailout is the provision of capital by the government to turn around banks and financial institutions that are insolvent or in crisis.
US Treasury Secretary Janet Yellen told news channels, ‘To be clear, big banks have been bailed out during the financial crisis, but we’re not thinking about that now. We’re not going to do that again.
The U.S. Treasury Secretary added, “Over the weekend we are hearing from people depositing money in the bank, many of them ‘small businessmen’ and employing thousands of people through them. Throughout the holiday period, we are working with the bank regulatory authorities, trying to determine the right policy to normalize the situation.”
US lawmakers have moved into this context. House of Representatives Speaker Kevin McCarthy spoke out against Senate Majority Leader Chuck Schumer’s idea of bailing out SVB. Republican Senator Mitt Romney also expressed concern.
In addition to the closing of Silicon Valley Bank last Friday morning, the trading of shares of ‘First Republic’, ‘Pacwest Bancorp’ and ‘Signature Bank’ was temporarily suspended. Later, on Monday, Signature Bank was also announced closed.
